07 Sep 5 Compensation Management Trends Taking Shape in 2017
Keeping an eye on compensation management trends can be helpful for HR professionals as they strategize and develop pay plans for their own organizations. As we head into a new season and make our way through the final quarter of the year, here are a few leading compensation trends to look out for:
1. Improving Benefits Decisions
HR Daily Advisor cites a study in which the majority of respondents (81%) listed managing costs as a top benefits priority, while 50% stated that helping workers to make better benefits decisions was also a top concern.
2. Breaking Up Bonuses
As part of a way to move towards a more ongoing approach to performance management, some organizations have begun breaking bonuses up into smaller, more regular amounts, according to HR Zone. In doing so, employers can make rewards and praise a more ongoing effort instead of a yearly “event” to support a fulfilling company culture.
3. Strategically Rewarding Top Performers
The Balance states that forward-thinking organizations should aim to offer a variable compensation rate of 7-8% in addition to base pay to top-performing staff members. In doing so, you can use your compensation structure to incentivize high performance and communicate your expectations, which brings us to our next point.
4. Using Compensation to Communicate
Organizations are now viewing compensation as a tool that can be used to communicate exactly what’s expected of employees. When management is clear on how pay decisions are made, employees can understand the “why” – not just the “what” – behind their pay, which can build trust across the organization.
5. Seeking Better Technology
The study referenced by HR Daily Advisor also shows that more than half of employers are looking for better compensation software to reduce workload. If your organization is like the majority, upgrading your compensation tool is one of the best decisions you can make. Not only will it reduce workload; it can also help you stay in line with the other four leading compensation trends listed here.
The best way for your company to approach compensation will depend on your organizational strategy, culture, and a number of other differentiating factors. Nonetheless, monitoring compensation trends is essential to making sure you’re paying fairly and competitively in today’s job market.
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